Apple event expectations raised the company’s shares by more than 6% on Monday, and they are raising prepaid trading by 2%. Amazon’s stock gained nearly 5% on Monday.
Apple’s agenda: Investors expect the company to announce the launch of a long-running upgrade that will allow the iPhone to connect to a 5G wireless network.
Some analysts expect the 5G iPhone to generate a “super cycle” of device upgrades, which is likely prompting more people than usual to buy the new device.
“Consumers wishing to buy a 5G iPhone will have no choice but to pay through Apple over the next two to three years and buy it directly,” said CFRA Research Analyst Angelo Zino.
Watch this space: According to the Bespoke Investment Group, Apple has announced only four of 15 iPhones. Even if there is some sales pressure on Tuesday, however, it is unlikely to wipe out Monday’s huge gains.
Meanwhile, Amazon is set to receive a fourth-quarter increase from its sales this week. Prime Day makes up less than 2% of the company’s annual sales, but is considered important for customer loyalty and adding new shoppers. The incident is occurring months later due to the epidemic.
Investor Information: Right now you have to work hard to find betting investors with tech names like Apple and Amazon, which have managed to bring in a heap of revenue during the epidemic. Traders see these companies as drivers of both growth and defensive pick as they are less affected by social disturbances and are likely to benefit from a long-term shift to online services.
Here’s what: According to Refinitiv, about 90% of analysts recommend Apple buying the stock or issuing a neutral rating. For Amazon, the percentage climbs to 98%.
Earning season begins
The American economy still has a long way to go before it can fully overcome the epidemic. But you may not know it from the mood of corporate income season.
LATEST: How income rises with investors is a matter of expectations – and analysts are confident that companies can beat Wall Street estimates for the period July to September, when the economy was rebounding.
If that prediction is correct, and there are signs that the economic situation is improving, then stocks are likely to get a boost.
Jeffrey Buchbinder and Ryan Dittrick of LPL Research said, “We will likely have another drop in profits in the third quarter, although potentially it is only about half that of the previous quarter.” He expects corporate America to increase income in early 2021.
Remember: Even though it is easier for investors to write off 2020 earnings, visibility on future profits or losses is limited. According to FactSet analyst John Butter, more than one of the S&P 500 companies is still not providing earnings guidance for 2020 or 2021.
Coming: This week’s main event is earnings from the largest US banks. Investors will be watching closely to see how many businesses and consumers are experiencing debt losses due to ongoing hardship.
However, Fitch Ratings has warned that there may not be clarity on this front until at least next year, noting that many banks have halted loan repayments to customers and the incentive money has led many Americans in the spring and summer have helped.
Disney puts streaming at the center of its media empire
Disney + has been a bright spot for the company, which has held Disney movies, stalled productions and closed parks and resorts for months.
Description, Description: The new structure will help Disney put its creative muscle behind the development and production of streaming content, and can make it easier for prestige content to be available on stage and not only in theaters, but also on television.
“The change will allow us to be more effective and agile in creating the materials that consumers need most,” Disney said in a statement.
- US inflation data for September at 8:30 am ET.
- Apple’s big event closed at 1 pm ET.